The shift is subtle but unmistakable. European governments long accused of being pro-Arab have toned down criticism of Israel, left in shock by the rise to power of Islamic Hamas, which they consider a terrorist outfit. The rise of Hamas and the subsequent deterioration of peace prospects have left the European Union in a quandary. The election of the Hamas government has pulled the rug out from under its $626.5 million-a-year aid package that feeds, clothes and educates many Palestinians and distanced the European Union from them. After the Hamas government was sworn in, the European Union strongly condemned it for refusing to recognize Israel. The one-page statement contrasted with the bloc's usually long Mideast declarations that take pains to show balance. The bloc's tilt toward the Jewish state was highlighted after Israel's attacks last week on infrastructure targets in the Gaza Strip. Normally such strikes elicit stinging rebukes, but this time, they brought only limp appeals ... http://www.washingtontimes.com

Residents on both sides of the Lebanese-Israeli border braced on Saturday for a dramatic spike in violence after Hizbollah's chief declared open war on Israel following its bombardment of his Beirut home and stronghold. "You wanted open war. We are going to open war," Sayyed Hassan Nasrallah said in a call to Hizbollah's television. "Look at it burn," he urged listeners, announcing an attack which set ablaze an Israeli warship that had earlier hit Beirut. Israel confirmed four of its sailors were missing after the strike, part of the bloodiest bout of violence in Lebanon in a decade, started by an attack on Wednesday in which Hizbollah guerrillas captured two Israeli soldiers and killed eight. ...http://abcnews.go.com/US/wireStory?id=2195202

British forces in Afghanistan have defended their decision to call in US planes to drop 500lb bombs on Taleban fighters in a town in Helmand province. Witnesses say there were many civilian deaths and injuries but UK forces said there was no evidence of any. Civilians in Nawzad told the BBC that aircraft dropped at least three bombs, destroying shops and a school. British forces have been protecting the district government headquarters in Nawzad for a month. British commanders said they had been under constant attack for the past two weeks and the Taleban fighters were close to overrunning the base when the US air strike was called in. ...http://news.bbc.co.uk/2/hi/uk_news/5182368.stm

It's been a long time since German-American relations were this heartfelt. During his visit to Stralsund, Germany, President Bush kisses the chancellor on both cheeks, says "good morning" and expresses his thanks for the gift of a barrel of herring.The chancellor stands next to her husband on the cobblestone-lined historic market square, behind Stralsund's medieval church and city hall. The flags fly from the red brick building: those of the United States, Germany and the European Union. Across the square, at the local offices of a trade union, other flags are being flown: 10 rainbow flags bearing the word "Pace," Italian for peace. Angela Merkel and Joachim Sauer are waiting for United States President George W. Bush. She's wearing a crème-colored blazor and black pants and he's wearing a gray suit. The chancellor makes a quick hand gesture to a security official. Should I stand here? The man nods, everything's perfect....http://service.spiegel.de/cache/international/0,1518,426632,00.html

The Iraq war could cost U.S. taxpayers between $202 billion and $406 billion more over the next 10 years, depending on how quickly U.S. force levels can be reduced, congressional budget experts said on Thursday.The Congressional Budget Office offered two cost scenarios for the war, which it said so far has cost almost $300 billion.If the number of U.S. troops in the Iraqi theater can be reduced to 140,000 next year from the current level of about 190,000 and all are withdrawn by the end of 2009, the CBO said military operations will cost another $166 billion in 2007-2016.But if troop levels decline more slowly and remain at about 40,000 through 2016, the CBO said military operations will cost another $368 billion.In addition, the CBO said U.S. funding for Iraqi security forces could total $15 billion over the next 10 years, and diplomatic and foreign aid could cost another $15 billion over that period....http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-07-13T230919Z_01_N13224205_RTRIDST_0_IRAQ-USA-COSTS.XML

A US army general who oversees the Guantanamo Bay detention camp has been chosen as Nato's next military head. General Bantz Craddock, chief of US Southern Command, has been picked to be Supreme Allied Commander, Europe. The choice of Gen Craddock, who succeeds retiring General James Jones, needs approval by the US Senate. Gen Craddock has normally defended the controversial camp against criticism, although he has ordered investigations into some claims of abuse of suspects. In one case, he blocked attempts to get a Guantanamo commander reprimanded over abuse claims, insisting the officer had done nothing wrong. Nato announced in Brussels that Gen Craddock had been chosen to replace Gen Jones, who was the first Marine to hold the post. I guess the world learned nothing from the Nuremburg War Crimes Trials...http://news.bbc.co.uk/2/hi/americas/5181910.stm